Million-dollar maybe

August 17, 2011

Why is Sacramento County, instead of raking in millions via taxes and fees, spending millions to shut down its medical-cannabis dispensaries?

That’s what attorney George Mull is wondering on the heels of last Wednesday’s board of supervisors meeting, when staff recommended spending $1.1 million over the next nine months to ratchet up enforcement against its pot clubs.

“I think it’s the biggest waste of resources I’ve seen in the county in a long time,” he said, arguing that it will be “more expensive for them than they can possibly imagine.”

Sacramento County says pot clubs are operating illegally, despite state law that permits the collective distribution of medical marijuana, and is threatening fines of up to $1,500 a day for zoning and building-code violations under the new plan, in addition to liens on property holders.

Mull, an attorney with the California Cannabis Association who’s worked on drug-policy cases since 1993, calls this the “million-dollar switch”: He says instead of spending millions, the county could collect upward of $4 million to $6 million annually via permit fees and taxation.

This money would go a long way, he points out. The county deficit this fiscal year was a click more than $90 million, and the county has laid off more than 1,300 employees since 2008.

Meanwhile, new pot-club-enforcement efforts will include hiring four more code-enforcement staff, plus another county counsel, and will be paid for with a combination of fines, loans and general-fund dollars.

County code-enforcement head Steve Pedretti says letters explaining the new approach will be sent out to dispensary operators and their landlords “in the next few weeks” and that enforcement will commence “very soon.” The board of supervisors will approve the new expenditures in September.

It’s a risky move—a million-dollar maybe, perhaps?—and one that many say might end up costing the county millions in wasted funds and litigation.

Mull, who represents a dozen or so local clubs as part of the Sacramento County Patients Collective alliance, explains that while the county estimates to fine some 56 pot clubs to the tune of $125,000 this year, in addition to thousands more in property liens down the road, club owners intend to contest and appeal each and every penalty.

“They’re not going to get that, because none of us are going to pay,” he assured.

For some county dispensaries, this appeals process already has been going for nearly two years. During these hearings, according to Mull, at least four county employees, including counsel and engineer Pedretti, have to take time off work to appear in court. In some cases, these proceedings are over a mere $100 fine.

Pedretti said, however, he only checks in on the occasional appeal hearing. “I like to go down and watch them,” he said, “but I’m not an integral part of the process.”

He also noted that, of his 24 code-enforcement staff, only two are working on marijuana cases.

The board of supervisors, who were unable to chat with SN&R for this story by deadline, directed staff last month to come up with different enforcement tactics. Supervisors Roberta MacGlashan, Jimmie Yee and Don Nottoli all praised this new approach.

Meanwhile, Max Del Real, a medical-cannabis lobbyist who was instrumental in working with the city of Sacramento to pass its ordinance last year, insists that not only will the county lose in court, but they’ll also lose in the court of public opinion.

“Once the public starts to realize that the county is spending money that she doesn’t have,” he argued, “I think that’ there’s going to be a public backlash.”

Kris Hermes, of medical-cannabis advocacy group Americans for Safe Access, says the situation here in Sacramento is sort of unique: The county hasn’t banned clubs outright, as in Orange County burg Dana Point, or written a nonpermissive ordinance, as in Los Angeles. But its strategy invites similar legal entanglements as ones faced by these Southern California governments: Dozens upon dozens of clubs, for instance, have sued the city of Los Angeles over due process, he says.

Mull thinks the county and the board of supervisors—“especially in a time where we’re laying off cops and teachers and [district attorneys]”—will quickly realize the folly of their ways.

“No matter how much they were saber rattling,” he said of last week’s meeting, “I think there are fiscal realities of government.”